How is a company put into liquidation?
There are two ways to liquidate a company. They are: (a) by an Order of the Court (an official liquidation); or (b) by a resolution of the members or creditors of the company (a voluntary liquidation). There are a number of ways that a voluntary liquidation can begin: (i) under the voluntary liquidation provisions of the Corporations Act (Part 5.5) where the members resolve that the company should be wound up (whether the company is insolvent or solvent); (ii) under the voluntary administration provisions of the Corporations Act (Part 5.3A) where the directors appoint a voluntary administrator and the creditors resolve that the company be wound up at the second meeting of creditors; or (iii) after the default of a deed of company arrangement (Part 5.3A) when the company is either automatically would up under the terms of the deed, or wound up by a resolution of the creditors.
